Deal to allow grocers to avoid accepting beer, wine empties

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Ontario grocers and The Beer Store have reached an agreement in principle on alcohol recycling that will allow retailers to avoid collecting empties in their stores and give brewers a new role, The Canadian Press has learned.

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The deal averts a potential death knell for Ontario's Deposit Return Program, as some grocers have warned they will refuse to accept empty containers on an as-needed basis starting Jan. 1, the same day The Beer Store is allowed to close an unlimited number of locations.

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The details are still being worked out, but the broad terms of the agreement mean consumers will continue to exchange empty glassware for their deposits at beer stores, with grocers paying the bills and brewers committing to ensuring there is a recycling point within 10 kilometers accessible to the vast majority of the population.

“This is positive news for consumers and the environment,” Roy Benin, president and CEO of The Beer Store, wrote in a statement.

“We are leaders in the use of deposit return systems and have an excellent track record of serving customers. This voluntary service agreement will allow Ontarians to have access to an empty alcohol return system that returns people their deposit money.”

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Behind-the-scenes talks between brewers and grocers, facilitated by the government, have been going on for months and stem from an earlier deal the government struck with The Beer Store to speed up Premier Doug Ford's plan to expand alcohol sales at convenience stores and other grocery stores.

That deal would require grocery stores more than five miles from a beer store to accept empty returns and extend that obligation to all grocers selling alcohol on Jan. 1. Many did not comply and warned the government that they would stop selling alcohol unless the program was improved, jeopardizing Ford's much-publicized alcohol expansion.

A spokesman for Treasury Secretary Peter Bethlenfalvy welcomed the agreement in principle, calling it a win for businesses and consumers.

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“This is another step forward in modernizing Ontario's alcohol market and providing more choice and convenience to Ontarians,” Colin Blachar wrote in a statement.

The previous agreement to accelerate the distribution of alcoholic beverages also included paying The Beer Store $225 million during the transition period and authorizing the closure of dozens of locations, which the retailer has regularly announced. The company must support at least 300 locations by the end of this year, but there has been no agreed minimum starting next year, leaving some doubt about The Beer Store's future.

This new agreement, which cements The Beer Store's continued role in recycling alcohol containers, could ensure there are no mass closures from January 1, although it remains to be seen whether it will continue some closures or even try to open previously shuttered or new stores to meet its 10km commitment. The Beer Store did not comment on this aspect.

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Karen Wirsig, senior environmental program manager, said the deal is good news, especially if it means the remaining beer stores will remain open and continue the recycling program, but as the details are worked out she hopes they will become more robust.

“Ten kilometers is a really long distance to expect someone in an urban area to travel to pick up empty containers,” she said in an interview.

“I think over time we will have to see an increase in the number of return locations, and then in smaller towns where beer stores have closed, they will have to look for alternative locations.”

Grocery stores have expressed concerns about the program for months, including sanitation and space issues, and say they are now glad there is a solution.

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“After months of negotiations, grocers and The Beer Store have reached an agreement that will make recycling alcohol containers simple and secure; a system that consumers know and expect,” Kim Furlong, president and CEO of the Retail Council of Canada, wrote in a statement.

The total cost of food is not yet known, and it is unclear whether they will pass on all or part of the cost to consumers.

Gary Sands, senior vice-president of public policy and advocacy at the Canadian Federation of Independent Grocers, said independent and small grocers would have to incur additional costs to install systems in their stores to collect and store empty containers for pickup, so there would be a cost no matter what.

“There are a number of independent grocers that have not applied for a license because of the recycling requirements, and we also know that there are independent people who have publicly said, 'If the problem isn't solved … I'm going out of business,'” Sands said in an interview.

“This will therefore ensure that we return to the original goal of providing more choice and convenience to consumers because more independent businesses will now apply for licenses and those with licenses will retain their licenses.”

Convenience stores are exempt from recycling requirements.

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